Back reshoring: new opportunities for Italian Made in Italy enterprises

Over the past decades there have been intense processes of production relocation in favor of foreign contexts connoted by significant comparative advantages in terms of, for example, labor and raw material costs.

More recently, however, this process seems to be experiencing a reversal, referred to as back-reshoring, whereby production activities previously outsourced by major business groups are returning to their country of origin. In the United States, this phenomenon is now an established reality, thanks in part to government incentives and lower costs related to energy supply.

The interesting fact is that our country is also witnessing a shift in this direction. A recent study has shown how some relevant Italian companies (e.g., Furia, Nannini, Beghelli) have left the countries where they were established to return to the Bel Paese. The reasons behind such a choice are many.

Undoubtedly, at present, labor costs have been outweighed by logistics costs. Coupled with this, firms appear increasingly wary of the political instability and, therefore, country risk that characterizes foreign contexts. Moreover, production offshoring can erode the image capital associated with the so-called “made in” effect (Maizza, 2014).

The striking fact is that Italy appears in first place among European countries affected by back-reshoring, second only to the United States of America. 40.7 percent of the 194 European cases of “repatriation” involve Italian companies, operating – in most cases – in the Classic Sectors of Made in Italy: textiles and footwear (43 percent),l ‘electrical and electronics (18.6 percent), automotive (5.8 percent) furniture and furnishing components (5.8 percent), from the biomedical sector(4.7 percent), health and wellness (4.7 percent), mechanical (4.7 percent) (Dl Legge” 2015).

It will be necessary to monitor ll phenomenon further before we can say whether it will have a large-scale impact or remain an entrepreneurial choice of a few. What is certain is that back-reshoring can be a concrete strategy to sustain the competitiveness of the Italian manufacturing industry at a time when emerging countries no longer offer the same certainties as they did a few years ago.

In fact, bringing businesses closer to their countries of origin means drastically reducing rlsponse times to the market, adding value to production through greater flexibility and emphasis on the Italian character of production. Made in Italy support policies can be an important incentive for business repatriation.

However, companies must necessarily carry out a rethinking of their international strategies that rewards the full valorization of the origin of productions, a decisive asset for successfully competing in global markets.

References of Law A. (2015), Back-reshoring:opportunities for ltaly, in www.leurispes.it Maizza A. (2014), ll back-reshoring for the revival of made in Italy, in www.managementnotes.it